USD/JPY Trading Range Forecast to Expand to 157–165 Yen, Up From Previous 155–160 Range

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According to LGT Asia Private Banking, on July 28, the USD/JPY trading range is forecast to shift higher to 157–165 yen from the previous 155–160 yen. The two experts cited multiple factors driving the change, including the significant interest rate differential between the U.S. and Japan, uncertainty surrounding exchange rate intervention, and rising Japanese fiscal risks. The bank noted Japan may adopt an unpredictable approach by reducing verbal intervention before taking actual currency action, potentially leading to larger and less predictable volatility in USD/JPY.
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